VeriSign Inc. (VRSN, Financial) filed Quarterly Report for the period ended 2010-09-30.
Verisign Inc. has a market cap of $5.74 billion; its shares were traded at around $33.45 with a P/E ratio of 30 and P/S ratio of 5.5. Verisign Inc. had an annual average earning growth of 10.4% over the past 10 years.VRSN is in the portfolios of Eric Mindich of Eton Park Capital Management, L.P., David Dreman of Dreman Value Management, George Soros of Soros Fund Management LLC, Bruce Kovner of Caxton Associates, RS Investment Management, Steven Cohen of SAC Capital Advisors, PRIMECAP Management, Mario Gabelli of GAMCO Investors.
gain on sale of $736.5 million, net of tax of $243.8 million. The divestiture transaction is subject to definitive adjustment to reflect the actual working capital as of the closing date. Current and historical results of operations of the Authentication Services business have been classified as discontinued operations. As a result of the sale of the checkmark logo, VeriSign is in the process of selecting, clearing and adopting a new logo for the Company.
fees by 7% from $6.86 to $7.34. We have the contractual right to increase the fees for .com domain name registrations up to 7% either in 2011 or in 2012 prior to the end of the current agreement with ICANN on November 30, 2012. On July 1, 2010, we increased our .net domain name registration fees by 10% from $4.23 to $4.65. We have the contractual right to increase the fees for .net domain name registrations up to 10% in 2011 prior to the end of the current agreement with ICANN on June 30, 2011. We offer promotional marketing programs for our registrars based upon market conditions and the business environment in which the registrars operate. We are largely insulated from the risk posed by fluctuations in exchange rates due to the fact that all revenues paid to us for .com and .net registrations are in U.S. dollars.
Our Naming Services revenues increased by $16.8 million and $44.5 million during the three and nine months ended September 30, 2010, respectively, as compared to the same periods last year, primarily due to a 9% year-over-year increase in the number of domain names ending in .com and .net and increases in our .com and .net registry fees in October 2008 and July 2010 as per our agreements with ICANN. The increase in Naming Services revenues for the nine months ended September 30, 2010, was partially offset by a $7.6 million decrease in revenues from a one-time project completed during the nine months ended September 30, 2009.
Cost of revenues decreased during the nine months ended September 30, 2010, as compared to the same period last year, primarily due to decreases in allocated overhead expenses, occupancy expenses, direct cost of revenues, expenses related to the CPS business, and contract and professional services expenses, partially offset by increases in telecommunication expenses, salary and employee benefits expenses and depreciation expenses. Allocated overhead expenses decreased by $11.0 million, primarily due to a decrease in allocable indirect costs and a decrease in proportional headcount within the cost of revenues function. Occupancy expenses decreased by $1.8 million, primarily due to the purchase in December 2009 of a previously leased facility, managements cost-saving initiatives to reduce overall utility expenses, and the elimination of certain shared services utility expenses as a result of the sale of the Authentication Services business. Direct cost of revenues decreased by $1.7 million, primarily due to a decrease associated with a one-time revenue project completed during the nine months ended September 30, 2009, partially offset by an increase in ICANN registry fees resulting from a fee increase effective
July 2009. Expenses related to our CPS business decreased by $1.4 million, primarily as a result of winding down the business. Contract and professional services expenses decreased by $1.4 million, primarily due to a decrease in services of outside contractors and the conversion of contractors to employees. Telecommunication expenses increased by $3.0 million, primarily due to an increase in colocation expenses and additional circuits required to support the increase in our network infrastructure. Salary and employee benefits expenses increased by $2.7 million, primarily due to an increase in average headcount. Depreciation expenses increased by $2.0 million, primarily due to an increase in capitalized hardware and software to support investments in our infrastructure.
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Verisign Inc. has a market cap of $5.74 billion; its shares were traded at around $33.45 with a P/E ratio of 30 and P/S ratio of 5.5. Verisign Inc. had an annual average earning growth of 10.4% over the past 10 years.VRSN is in the portfolios of Eric Mindich of Eton Park Capital Management, L.P., David Dreman of Dreman Value Management, George Soros of Soros Fund Management LLC, Bruce Kovner of Caxton Associates, RS Investment Management, Steven Cohen of SAC Capital Advisors, PRIMECAP Management, Mario Gabelli of GAMCO Investors.
Highlight of Business Operations:
On August 9, 2010, we sold our Authentication Services business, including outstanding shares of capital stock of VeriSign Japan and trademarks and certain intellectual property used in the Authentication Services business (including our checkmark logo and the Geotrust and thawte brand names), to Symantec for a cash consideration of approximately $1.14 billion, net of cash held by transferred subsidiaries of $127.5 million and transaction costs of $10.8 million. Also included with the sale of the Authentication Services business were real and personal property owned by the Company at our Mountain View facility and other locations. We recorded again on sale of $736.5 million, net of tax of $243.8 million. The divestiture transaction is subject to definitive adjustment to reflect the actual working capital as of the closing date. Current and historical results of operations of the Authentication Services business have been classified as discontinued operations. As a result of the sale of the checkmark logo, VeriSign is in the process of selecting, clearing and adopting a new logo for the Company.
fees by 7% from $6.86 to $7.34. We have the contractual right to increase the fees for .com domain name registrations up to 7% either in 2011 or in 2012 prior to the end of the current agreement with ICANN on November 30, 2012. On July 1, 2010, we increased our .net domain name registration fees by 10% from $4.23 to $4.65. We have the contractual right to increase the fees for .net domain name registrations up to 10% in 2011 prior to the end of the current agreement with ICANN on June 30, 2011. We offer promotional marketing programs for our registrars based upon market conditions and the business environment in which the registrars operate. We are largely insulated from the risk posed by fluctuations in exchange rates due to the fact that all revenues paid to us for .com and .net registrations are in U.S. dollars.
Our Naming Services revenues increased by $16.8 million and $44.5 million during the three and nine months ended September 30, 2010, respectively, as compared to the same periods last year, primarily due to a 9% year-over-year increase in the number of domain names ending in .com and .net and increases in our .com and .net registry fees in October 2008 and July 2010 as per our agreements with ICANN. The increase in Naming Services revenues for the nine months ended September 30, 2010, was partially offset by a $7.6 million decrease in revenues from a one-time project completed during the nine months ended September 30, 2009.
Cost of revenues decreased during the nine months ended September 30, 2010, as compared to the same period last year, primarily due to decreases in allocated overhead expenses, occupancy expenses, direct cost of revenues, expenses related to the CPS business, and contract and professional services expenses, partially offset by increases in telecommunication expenses, salary and employee benefits expenses and depreciation expenses. Allocated overhead expenses decreased by $11.0 million, primarily due to a decrease in allocable indirect costs and a decrease in proportional headcount within the cost of revenues function. Occupancy expenses decreased by $1.8 million, primarily due to the purchase in December 2009 of a previously leased facility, managements cost-saving initiatives to reduce overall utility expenses, and the elimination of certain shared services utility expenses as a result of the sale of the Authentication Services business. Direct cost of revenues decreased by $1.7 million, primarily due to a decrease associated with a one-time revenue project completed during the nine months ended September 30, 2009, partially offset by an increase in ICANN registry fees resulting from a fee increase effective
July 2009. Expenses related to our CPS business decreased by $1.4 million, primarily as a result of winding down the business. Contract and professional services expenses decreased by $1.4 million, primarily due to a decrease in services of outside contractors and the conversion of contractors to employees. Telecommunication expenses increased by $3.0 million, primarily due to an increase in colocation expenses and additional circuits required to support the increase in our network infrastructure. Salary and employee benefits expenses increased by $2.7 million, primarily due to an increase in average headcount. Depreciation expenses increased by $2.0 million, primarily due to an increase in capitalized hardware and software to support investments in our infrastructure.
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